Skift Take

Worries about their finances may have more Americans opting for their couches, not coach seats this holiday season. The go-go days coming out the pandemic of unbridled demand may be settling back down to reality.

Despite 2022 being viewed as the year travel returned to normal, U.S. adults are planning to travel less this holiday season than last year, largely because of financial concerns and lingering worries from this summer’s widespread travel disruptions, according to a recent survey by Deloitte.

Only 31 percent of U.S. adults said they plan to travel between Thanksgiving and mid-January, compared to 42 percent in 2021. Furthermore, 40 percent of respondents who are choosing not to travel said their financial situation is worse than last year. After money issues, concerns pertaining to travel disruptions and Covid both attracted 18 percent of responses for reasons not to travel this holiday season.

And even among those planning to travel, three in four travelers have said that their travel budget is lower than or the same as in 2021.

“In-person interactions are still a high priority for many this year, but certain households are being more challenged by rising inflation,” said Deloitte Vice Chair Mike Daher.

“That paired with service disruptions that occurred over the summer has a heavy influence on demand for this holiday season.”

Comparing Summer and Holiday Season Travel

Regarding the main differences between summer and end-of-year travel, the summer break offers a wider, more flexible travel window while the holiday seasons provides a fixed and much tighter travel window. In addition, those who experienced this summer’s chaos have unfavorable experiences to draw on when thinking about travel during this year’s holiday season.

“The holidays are a little bit more of a high stakes game because you can’t move Thanksgiving day, Christmas or New Years,” Daher said. “Risk tolerance level on service disruptions is lower during the holiday season.”

“They’re making that risk-reward calculation of ‘I just experienced this terrible thing over the summer, do I really want to picture myself buying all these tickets just to experience service disruptions and potentially miss the opportunity to be with my family on Thanksgiving day?'”

Besides choosing to avoid unnecessary stress, travelers might also feel less pressure to travel during a more expensive season due to the flexibility remote work provides them. Roughly 21 percent of U.S. adults planning to travel in January immediately after the holiday season said they’re going overseas, a 10 percentage point jump from those intending to do so between Christmas and New Years.

“Historically, in pre-pandemic times, those travel windows were really tight,” Daher said. “Now with the flexibility of remote work and the possibility for bleisure trips, people can extend their trips longer and take advantage of flexible airfares as a result.

Financial Concerns Heavy For Most, But Not All

Financial concerns still remain the number one reason why U.S. adults are not traveling this holiday season. Among the three age groups of non-travelers surveyed, middle-aged adults, those between 35 and 54 years old, were most concerned with financial issues. Forty-one percent of non-travelers in that age group said they couldn’t afford holiday travel. Meanwhile, 35 percent of 18 to 34 year-old respondents and 36 percent of those 55 years of age and older not traveling cited financial concerns as the main factor for their reason.

However, the decline in holiday travel intent from 2021 to 2022 for 18 to 34 year-old respondents was four percent. That’s significantly smaller than the drop for those between 35 and 54 years of age and respondents older than 55 — 15 and 14 percent, respectively. 

And of U.S. adults intending to travel, younger travelers are expected to spend more on travel, whether that means more expensive modes of travel or more in-destination activities. The survey found that travelers between 18 and 34 years old are more inclined than those in other groups to fly, both domestically and internationally.

“Younger generations are still more experience-driven,” Daher said. “Once travel restrictions were lifted, many airlines started expanding route capacity, adding several unique destinations that are now available through direct flights from the U.S. and I think that’s driving interest among younger travelers.”

Shaping a New Travel Market

Amid changes in travel spend behavior and concerns about travel disruptions, the report revealed that higher-income Americans are twice as likely to travel than lower-income Americans and 1.3 times as likely to travel as middle-income Americans. So Daher believes the travel industry will increasingly target higher-income consumers.

“Those products that traditionally serve lower income households, like ultra-low cost carriers for example, may see some softening or have to do more promotional pricing,” Daher said.

“Network carriers may not be as affected if they’re able to continue to improve their product, improve their service levels and be reliable to attract those higher-income (consumers) who still have the desire to travel despite economic conditions.”

Despite inflation, Daher sees those planning to travel not hesitating to spend more money on their trips.

“Many leisure travelers paid for business class, upgraded hotel classes, and paid for airline club memberships. People are willing to pay if they are able to get the product and service that they expect,” Daher said.

“The market is continuing to shift. Therefore, the travel companies that are able to provide the superior product or service, such as investing heavily in hard product or in digital to provide a more seamless travel experience, are better positioned to win in this new travel world.”


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Tags: coronavirus recovery, deloitte, flight cancellations, holiday travel, survey, surveys, thanksgiving, tourism, united states

Photo credit: U.S. travelers are planning to travel less this holiday season in large part because of financial concerns. Amy Humphries / Unsplash

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